SINOMINE is to build a $500m lithium refinery in Zimbabwe in the next three to five years despite losing money following a crash in the price of the metal.
“We have to borrow from the market and investors,” Xuedong Gong, MD of Bikita Minerals, a subsidiary of Sinomine Resource Group, told Bloomberg News in an interview. “We don’t have much money.”
Sinomine is one of several Chinese mining companies that entered Zimbabwe as a spike in lithium prices during 2021 and 2022 fueled a wave of transactions, swiftly turning the nation into a significant producer of the battery metal, said Bloomberg News.
According to Morgan Stanley, mined supply of lithium is expected to increase to 1.37 million tons this year from 1.02Mt in 2023. Of this about 114,000 tons and 62,000 tons – about half – will come from China and Zimbabwe respectively.
Lithium production has taken off in Zimbabwe, largely owing to some $1bn in investment by Chinese miners including Zhejiang Huayou Cobalt, Chengxin Lithium Group, Yahua Group and and Canmax Technologies, according to a report by Reuters in November.
In June, Prospect Lithium Zimbabwe, an arm of Chinese company Zhejiang Huayou Cobalt, opened a new lithium mine in which has a capacity to process 4.5 million tons of hard rock lithium into concentrate for export per year.
President Emmerson Mnangagwa’s government has urged investors to go beyond exporting lithium ore or concentrate by carrying out more processing domestically, said Bloomberg News.
